North American Life Insurance Reviews – Should you pass?

North American is one of the life insurance companies that we feel is always knocking on the door of our best life insurance companies list, but just barely misses making it on the list.  In our North American life insurance review, we will tell you all the reasons why North American did not make the cut.

North American Life Insurance Review

Our agency will cover North American’s life insurance contracts, Noth American’s life insurance rates, and where we feel North American makes sense for our clients.  Let’s say that North American is on our watch list.

Shall we get started?

North American Life Insurance Company History

The North American Life Insurance Company was founded in 1886 as the North American Accident Association (not to be confused with the North America Life Insurance Company of Texas).  North American has been paying out death benefits to its policyholders for over 130 years.

North American Life has weathered a lot since the late 1800s.  It has faced epidemics, world wars, as well as financial crises and is still going strong.  North American to this day remains privately owned.  Not many life insurance companies can tout that they are genuinely independently owned.

North American boasts that their private ownership means that they are not subject to short-term pressures of publically traded financial markets like other publicly traded life insurance companies. It is this long-term vision that has shaped North American over the years into the life insurance company that it is today.

Nowadays, North American is a big player in both the life insurance an annuity market headquartered in both Sioux Falls, SD, and West Des Moines, IA. North American has over 600,000 life insurance and annuity policies held and manages more than $25.6 billion in assets!

North American Ratings and Financial Strength

North American has a bullet-proof balance sheet and strong financial ratings from many of the top independent rating agencies. A.M. Best Company rates North American as an A+ (Superior).

North American was also awarded an A+ (Strong) rating from S&P and an A+ from Fitch if you wanted a second opinion to A.M Best Company.  These consistently high financial strength ratings have resulted in an unsurprisingly high North American Comdex score in the 90s.  Keep in mind that a perfect Comdex score is 100.

A.M BestS&PFitch
A+
A+
A+

While North American has been in business for over 130 years, they were never an accredited business with the Better Business Bureau until September 24, 2018, which surprised us initially. However, North American’s BBB rating of A+ is unsurprising.  You do not stay in business as long as North American has without doing the right thing for your policyholders.

North American Life Insurance Solutions and Other Products

North American offers a variety of different life insurance and annuity products today for the benefit of their policyholders. North American term life insurance and universal life insurance are the core life insurance products that the company offers.  North American also offers a suite of annuity products.

North American Term Life Insurance

Term life insurance is more popular today than ever in the history of life insurance.  As average life expectancy increases, we have seen term life insurance rates plummet in recent years. In fact, it is so affordable to purchase term life insurance today that there is really no excuse not to have it if you are otherwise healthy and qualify for it.

North American offers term durations of 10, 15, 20, and 30-year terms. Like most term policies, your premiums are guaranteed to remain level during the term period that you select. You will have your standard array of optional riders that you can add on such as the waiver of premium, children’s term rider, and accelerated death benefit rider for terminal illness.

North American term life insurance is usually very competitive. While they rarely are in the lowest cost position, they are usually within the top 5, and the difference in cost is normally very minimal (for example a few dollars). Although, for that extra few dollars of premium you get additional value in the form of living benefits and one of the better term life insurance conversion options on the market.

Besides the usual riders, North American has recently included living benefits for critical and chronic illness into their term life insurance policies for no additional premiums.  While we applaud North American for taking this step, there are term life insurance contracts available that offer more robust living benefit options.

One standout feature is North American’s conversion privilege built within their term policies.  Should your life insurance needs change down the line, you can exchange all of your term life insurance coverage with a permanent life insurance policy.

Currently, North American allows you to convert into all currently available individual permanent life products.  Many life insurance companies will force you to convert into a conversion specific life insurance product that is created specifically for conversion purposes. The fact that North American allows a wider array of options justifies the slight increase in premiums you may pay in our opinion.

North American term life insurance underwriting is fair, but it lacks a guaranteed no-exam path. If you okay with taking an exam if necessary, North American’s accelerated underwriting program may be a good choice though.

North American will waive the exam requirement at fully-underwritten rates on a case-by-case basis for applicants who meet certain requirements.  If you do not qualify for acceleration, then the underwriting process will continue as normal with the exam requirement added.

If you are adamant that you want to purchase life insurance without the hassle of a medical exam, then you need to read our list of best no-exam life insurance companies.  Currently, Sagicor Life has one of the hottest accelerated underwriting programs on the market today.  We have seen qualified applicants fly through underwriting with no medical exam within minutes.

North American Universal Life Insurance

Whenever the conversation of top universal life insurance companies comes up, North American is frequently in that conversation.  North American has a number of universal life insurance products for just about any situation.

Surprisingly, North American does not offer a whole life contract at this time.  If you are interested in whole life insurance, we would recommend checking our Foresters life insurance review.

In place of whole life insurance, North American offers the Custom Guarantee guaranteed universal life insurance for lifelong guaranteed death benefits. Guaranteed universal life usually has little, or no cash surrender value within a guaranteed universal life insurance policy, but premiums tend to be lower than whole life insurance policies of similar death benefits.

North American’s guaranteed universal life insurance policy can be exchanged to a North American cash accumulation universal life insurance policy. Having a cash value account can be useful.  If you need money for an unforeseen expense, being able to tap into your life insurance can offer great flexibility when the unexpected occurs.

North American offers a wide selection of indexed universal life insurance contracts that can be structured for death benefit or cash value purposes. North American is a leader in using index universal life insurance for cash value accumulation.

North American Index Universal Life Options:

  • Builder IUL
  • Builder Plus IUL
  • Rapid Builder IUL
  • Guarantee Builder IUL
  • Legacy Optimizer IUL
  • Survivorship GIUL

The reason why indexed universal life is a popular vehicle for long-term cash value accumulation is its risk profile and tax advantages. Index strategies allow you to participate with the upside of a market index without actually investing your principal directly in it. If the market crashes, your principal is safe.  You will not be credited with any interest since the market did not go up that year, but you will not lose any money either.

Index universal life has certain tax advantages as a life insurance policy. The cash value grows tax-deferred, and you can access your cash through tax-free withdrawals of premium and loans. If you are looking for a savings vehicle that offers principal protection and tax advantages, an index universal life insurance strategy is worth a look.

Sample North American Life Insurance Quote

We have included a sample of North American term life insurance quotes.  Remember that you need to qualify for these rates based on your health, lifestyle, and various other factors.

Sample North American Term Life Insurance Quote: (Age 45)

DEATH BENEFITMALE 10-YEARMALE 20-YEARFEMALE 10-YEARFEMALE 20-YEAR
$ 250,000
$ 22.66
$ 35.86
$ 20.02
$ 28.82
$ 500,000
$ 38.72
$ 64.68
$ 33.88
$ 50.16

Please note that these North American Life Insurance quotes are for the preferred best non-tobacco health class. 

North American Annuity Products

Most life insurance companies will offer life insurance and annuities in their product offerings.  Both life insurance and annuities are based in actuarial science (the science of insurance risk). Life insurance is for when you die too soon, and annuities are for if you live too long. While the focus of our life insurance reviews is on life insurance, we will briefly touch on North American’s annuities.

North American offers the following annuity products:

  • Multi-year guaranteed annuities (MYGAs)
  • Single premium immediate annuities (SPIAs)
  • Fixed index annuities (FIAs)

Fixed index annuities have increased in popularity in recent low-interest-rate environments.  Similar to indexed universal life insurance, indexed annuities track a market index, but your principal is not directly invested within the market.  This protects your savings from investment loss.

Fixed index annuities are designed to compete with CDs and overtime can outperform fixed interest rates. That said, we have seen a surge in MYGA popularity as interest rates have bounced off of record lows with their guaranteed interest rates.  A MYGA is the CD of the insurance world.

SPIAs are designed strictly for lifetime income.  You get to turn a lump sum of savings into an income stream.  This income stream can be for a certain period of time or for the rest of your life. This type of annuity often produces the highest monthly payment of guaranteed income, but you need to trade access to the principal in order to achieve that maximum.

Final Thoughts: Is North American Life Insurance Worth It?

First, thank you for taking the time to read our North American Life Insurance Review.  North American is a dependable life insurance company. They have history and have been in business over a century, which means that they are committed to the craft.  So why did North American not make our list of best life insurance companies?

North American’s term insurance is affordable, but it is not always the rock-bottom lowest price. North American’s underwriting is fair, but nothing that standouts.  North American offers an accelerated underwriting program that may waive your medical exam if you meet certain criteria, which many life insurance companies offer nowadays.  However, they lack a true express issue life insurance product that guarantees no medical exam.

North American’s recent addition of living benefits for chronic and critical illness to their term life insurance was a welcomed addition. Anytime the policyholder can get more value at the same cost is a win. That said, we’d like to see them expand the triggers of their living benefits to levels on par with other living benefit term life insurance options on the market.

North American’s UL products are highly competitive. North American offers a wide array of universal life insurance designed for both affordable lifetime death benefits and cash value accumulation. No North American whole life product as of the writing of this review though.

You can learn more about North American life insurance on the web, or call the North American phone number 1-877-872-0757.

FILED UNDER – LIFE INSURANCE COMPANY REVIEWS

Resources: North American Life Insurance 

Joseph Cirillo of Good Life Protection

Joe is a lifelong learner with a passion for sharing what he has learned with others. Joe has publicly spoken on life insurance in the past to both colleagues at industry conferences and to consumers in educational settings and as a contributor to industry blogs.  Additionally, Joe is studying for certifications such as the CFP, CLU, and RICP to further his professional knowledge.